Death of a Dissident - Alex Goldfarb [23]
Spring 1995: Chechen ambushes accelerate, and separatists mine roads throughout the war zone. On June 14, eighty rebels led by warlord Shamil Basayev seize a hospital in the Russian city of Budyonnovsk, seventy miles from the Chechen border, taking more than fifteen hundred hostages. A tense standoff, interrupted by botched Russian attempts to retake the hospital, finally leads to a deal: most of the hostages are released in exchange for Yeltsin’s agreement to a cease-fire to the war, allowing negotiations. The militants return to Chechnya as heroes. Russian Prime Minister Viktor Chernomyrdin, who conducts televised negotiations with Basayev, emerges as a leading dove in the Kremlin.
“Russia is falling into a black hole which will drag the entire region with it,” Soros gloomily predicted late that summer. He asked me to gradually wind down the science program so that we wouldn’t be “burning cash for nothing.”
He was still reluctant to consider a loan for ORT. “Boris needs a strategic partner, and I don’t understand anything about television,” he said. “I can introduce him to someone.”
But that potential partner, an investor in one of the big American networks, did not want to give Boris a loan either. Instead, he simply offered to buy a chunk of ORT. Boris said that wasn’t possible, as the Communists in the Duma would kick up an incredible fuss once they found out that Channel One was being sold to Americans. Well, if that’s how it was, the strategic partner said, then even a loan would bring a huge political risk. The deal didn’t go through.
The only good news was that the success of the revamped Channel One exceeded all expectations. A new team headed by the liberal journalist Konstantin Ernst, a young intellectual with shoulder-length hair, revamped programming, changed the format and style of the news, and produced entertainment broadcasts targeted at young viewers. The network strove to create a vision of dynamic, prosperous, Westernized Russia, a place where you wanted to live, if only the Communists didn’t drag it back into the Soviet past. The ratings rose steadily, gradually overtaking NTV, but the main problem remained unresolved: the network continued to run huge losses. Boris constantly searched for money to keep it going. He thought he just needed to buy a year’s time, until the presidential election.
He was certain that after Yeltsin’s victory, foreign investors would line up to see him. Once, as we sat on the terrace of The Club drinking an incredibly good bottle of Chateau Latour, his favorite wine, I asked him what he would do if Yeltsin didn’t win. He looked at me as if I were an idiot. “What do you mean, not win? That can’t happen! Did you ever get into a fight when you were a kid?”
“No,” I admitted.
“Well, you cannot get into a fight thinking that you may be beaten. And not just beaten, but hung from a lamppost! Well, we can’t even think of losing. These aren’t your municipal elections in Cincinnati. This is a revolution, old boy!”
Chubais, despite his Davos speech, was still scrambling. His voucher program had privatized more than half of the economy, but in the form of a massive number of small and medium-size businesses. He had not yet touched the biggest companies: oil and gas, minerals, telecommunications, military industries. These enterprises were still operated by their former Soviet managers, many of whom were siphoning off funds through third-party sales outlets, laundering the proceeds or stashing them abroad in offshore tax havens.
The managers of these large state-owned enterprises were known collectively as “the director corps,” and they constituted a powerful lobby whose Kremlin